By on August 19, 2009

No, we’re not talking about becoming the official web site for Michael Vick. This one involves two stronger dealers in a financial wrestling match. Yesterday afternoon there was a rarely used camper conversion van at the Carmax sale. The model year was 1993. It was a Chevy Van (of 1970s singing fame) with a mini fridge, plastic toilet, furnace and all the hookups you would need to go camping. A very nice package with only 43,000 original miles. The prior owner had been in the military and kept it all in tip-top shape. But then THEY arrived . . .

I knew there was something wrong when the keys were locked in the vehicle from the early get go. The buyers at Carmax were immediately on it. But even getting through the seal was a challenge due to the design of the door. I offered my New Jersey upbringing as a means for prying said lock. But that thing was tight. One of the dealers in the free for all waited about twenty minutes before the lock was prodded and the vehicle became open again. The heat index was 100°+ and this being the second long sale of the day, no one was in a happy mood.

In the meantime the sale started. 105 vehicles followed an orderly procession as the prices zoomed headlong into tax season levels. $2000 for a 1997 Plymouth Breeze with low miles and a bad engine? Sure! Another $2K for a base 1998 Grand Caravan with no rear air? Why the heck not. A 2000 Ford Contour that runs only on compressed natural gas for $1500. Okey-dokey. The larger buy here – pay here lots were trying to scavenge whatever they could and even the larger wholesalers found themselves on the defensive. It was clear I was going to become a true casual observer for most of the afternoon.

Then it happened. The van trudged through the lane with the auctioneer giving a very full description of the prior owner and the vehicle. The price went down . . . $7000, $6000, $5000 . . . all the way to $3000 until the van finally got the money. Five bidders became three bidders and by $3800 only two bidders remained in the fight. The first fellow gave the usual dealer stare with the finger pointed at themselves that says, “I’m on it. I want this one. Please leave it alone.” The second dealer gives an ear to ear grin pointing at his Dad which means, “I’m buying it for my Dad. He really wants it.” Dealer #1 mouthed out the word “Bullshit!” and the fight was on. The hundreds and fifties piled up until the second dealer became the winning bidder at $5650 (plus $200 auction fee).

Everyone was laughing, including the Dad, and only two fellows were oblivious to it all. Afterward the winning dealer told me he was really going to be keeping it for his Dad. But he told me the same exact line two months ago when we were dogfighting over a grey market Mercedes S-Class. I guess the old dogs of this business never get tired of using the same old tricks.

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20 Comments on “Hammer Time: Dogfight!...”


  • avatar
    no_slushbox

    If C4C doesn’t get extended people it looks like both new and used dealers will be left holding too much overpriced inventory.

    I guess all this means for non-dealers is that this is a horrible time to buy a car unless you are really able to take advantage of C4C, and that it might be a good time to unload a car that you don’t want on a used car dealer (if they really are this desperate for inventory).

  • avatar
    jpcavanaugh

    The keys locked inside is the perfect way to deal with that vintage Chevy van. They should just all be that way. Having driven one, I can understand how it had such low mileage. Its owner just couldn’t take it.

    I had to drive the cargo version for one of my College jobs. GAD, what a horrible vehicle. My favorites were the Dodges – they had the tightest structure of any of the vans, if you could deal with the Mopar electricals. The LA engines and the Torqueflite trannys were a pleasant combination. The Fords were the smoothest and most reliable, though the structure was a bit flexier/creakier than the Dodge.

    But the Chevy was twisty and rattly, more rustprone than the Dodge or the Ford (if that was possible) and just an all-around miserable vehicle to drive. Step on gas, wait for hesitation, then vehicle weakly lunges forward. Park. Put rubber knob back on shift lever and turn off key, wait for dieseling to stop. Ahhh – memories.

  • avatar
    NulloModo

    no_slushbox – C4C isn’t really hurting deals on new cars as much as you would expect. I can’t speak for all automakers, but Ford hasn’t reduced incentives on new models due to C4C, after all, 2010 just came out so incentives were expected to be very light at this point.

    While we are holding on to full sticker on certain models, namely Fusions, Focuses, Escapes, Transit Connects, Flexes and Rangers, and to a certain degree Edges, you can still make just as great a deal as ever on the less clunker-worthy models such as Explorers, Expeditions, F150s, Super Duties, and E series vans.

    Used car prices are both higher and lower right now, depending on the model. We aren’t able to pick up cheap older-but-low-milage Crown Vics and Grand Marquis like we used to, but at the same time as people are buying new Fusions/Focusses vs used ones due to C4C, prices on those used models aren’t skyrocketing.

  • avatar
    no_slushbox

    re: NulloModo:

    You’re right, it is much more complex than what I said, based on the C4C cut-offs.

    And there are a lot of really good deals on late model used cars that people aren’t buying because they don’t qualify for C4C.

  • avatar
    Airhen

    Those vans were like having a spare room inside. No wonder someone decided to offer a camper version. But on ice they were frightful.

  • avatar
    Deepsouth

    The beauty of the auction market. The van proves the old adage. Something is worth what the last bidder will pay. Ebay anyone?

  • avatar
    jkross22

    I love capitalism. Thanks for sharing this insight into the auto auction world.

  • avatar
    50merc

    “the winning dealer told me he was really going to be keeping it for his Dad. But he told me the same exact line two months ago”

    Could it be that used car dealer wasn’t telling the truth? I thought their code of ethics prohibited fibbing.

    Seriously, another great article, Steven. I wonder what Carmax paid the former owner. Under $3,000, I bet.

  • avatar
    50merc

    no_slushbox: “And there are a lot of really good deals on late model used cars”

    Thanks for mentioning that; I had assumed demand was strong across the board. A nice used Fusion, Milan or MKZ would serve me well, but I figured C4C was bringing the cost of new ones too close to that for used ones with some warranty left.

  • avatar
    Cole Trickle

    Sticker for a new Fusion. Awesome.

  • avatar
    jckirlan

    no_slushbox: “And there are a lot of really good deals on late model used cars”

    Guidance please I need guidance. We’ve been looking for a decent 7 passenger vehicle or nice car(used please) but the prices are off the charts. What would the B&B suggest. Or just guidance on which products are way undervalued right now.

  • avatar
    Steven Lang

    Chrysler minivan with a little bit over 100k, well maintained and with service records.

    Price would only be about $4000 to $5000. I’ve sold plenty of them and financed quite a few as well.

  • avatar
    Detroit-Iron

    @SL

    I’m sure that your info is authoritative about the value but just so you know, I would no sooner set a briefcase full of Benjamins on fire as pay $4k-$5k for a Chrysler product with more than a 100k.

  • avatar
    MadHungarian

    We’re all forgetting the really good news, which is that this vehicle is NOT getting the liquid glass treatment now.

  • avatar
    amnesia622

    jkross22 : It’s far from capitalism

    I am a dealer, I now rely on my service department to keep me alive. I do not miss selling cars one bit. I still go to Southern Auto Auction, Manheim and local Carmax auctions and always end up empty.

    There is a shortage of GOOD used cars at auction. Anything that is good brings big money. You’ll be lucky to break even.

    Let me start by saying dealers are the biggest idiots ever.

    This is supposed to be a wholesale auction yet is bringing prices higher than any dealer could dream of selling a vehicle for. This vehicle for his “dad” will sit on that particular dealers lot for the next 90 days. Not move, and be back at a dealer auction where they will sell it at a loss. Anyone who is a car dealer here must agree it is very hard to make a living buying cars at auction and reselling them as an independent. Sure you can flip a couple here and there for a profit but if you have REAL overhead and a REAL licensed dealership with all the overhead that goes along with it, it’s tough to stay afloat. If you are making it work let me know your secret.

  • avatar
    Steven Lang

    Southern Auto Auction? Say Hi to the mumbling (Munter) brothers for me!

    At least for me these days, to make a profit you have to…

    1) Finance whenever possible, and keep very close tabs on those you self-finance.

    2) Find vehicles with good ownership histories… a few of which will have cosmetic issues and typically go for far cheaper prices at the auctions.

    3) Fix everything right the first time. I try to drive everything I get for 100 miles before putting it on the front line. You can tell by that sentence I’m not a heavy retailer.

    4) Throw in a load of incentives that not only keep the buyer happy, but also gives them the opportunity to make a good return on a referral ($125 for a cash deal, $150 for a finance deal if the buyer pays on time for 90 days).

    5) Make payments low. Most folks I deal with pay $50 to $60 a week. A few of the rare or higher end vehicles will go for $80. I know guys who will go double on those figures and they have the repo rates and trashed cars to prove it.

    5) Finally, be very discerning about who you do business with. Saying ‘No’ is not a bad thing if the information you’re given by the prospective customer doesn’t add up. The cheapest insurance you’ll ever get is to be very conversational, friendly and inquisitive before making the deal.

    In Georgia, I have a good friend of mine who is going the other way. He’s renting out his shop and concentrating on the retail side. I always thought this was the better way to go from a stress related perspective. You avoid managing the people, and the problems, that come with the repair side.

    For example, I can tell you that here in Georgia most established shops have probably had more visits by the police for bad customers than in the last three years combined. They come for a repair. They’re broke. They don’t pay. Then they think they can just get the car and go or ‘negotiate payments’.

  • avatar
    WildBill

    Good article. I missed out on a cherry ’89 Ford conversion van that an older couple had put up at their “moving to the assisted living” sale last year. It only had around 50,000 miles and looked like new. I think it only brought something like $3,500. I was bidding on a farm tractor and some equipment (which I didn’t get) while a second ring was doing the van and some other items. Didn’t really need it but would have been sweet. Had an ’89 Club Wagon at the time with 140K on it and several problems but love the ride, I don’t think there is a better van out there for traveling long distance. It had made many trips from Ohio to New England on antiquing missions (if you’ve ever been to the Brimfield shows you know what I mean by mission).

  • avatar
    Omnifan

    Good article. I miss going to auctions. One car in particular I remember was a late 70s Chevette Scooter. The one without a back seat (or much anything else). This car had been owned by a state university with 100K on the clock. Auctioneer started at $1000 and couldn’t get any bids. Dropped to $100 and two folks starting a war. Car sold for $900. I had to admire the auctioneer.

  • avatar
    Mike66Chryslers

    I had a 1984 GMC 3/4 ton van with the 6.2L diesel as a daily driver. It was a full window van with 2 bench seats in the back and full interior and carpetting, all factory equipment. I thought the handling in the snow was good, and very predictable. Turning radius was good for a vehicle of its size, better than my Dodge pickup anyhow. Acceleration was poor (no turbo on the diesel) and it wallowed a bit through the turns, but I was certainly happy with the fuel mileage, even when towing.

    I once test-drove a GM conversion van, much like the one pictured, but it also had a 6.2L diesel like mine. It would’ve made a poor replacement for my van: Top-heavy due to the raised roof, even slower acceleration due to the added weight, and less room for hauling passengers and stuff. From that brief encounter, I decided that a conversion camper van has too many compromises to be very good at anything. No sale.

  • avatar
    hal

    @jckirlan
    for a used 7 passenger vehicle I think a 2007 KIA Sedona offers a decent deal. You get best in class safety (equal to the Odyssey). Decent reliability (better than the T&C, not as good as the Odyssey). The remainder of a 60k/5year warranty And basically all the features you need. If you want to buy new get an Odyssey. If you can’t stand the thought of driving a van get a Ford Flex.
    For a large used sedan I like the Ford 500.

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